One of the biggest collective sale sites in dollar terms so far this year is expected to be launched for sale next week. Hawaii Tower, on Meyer Road, has a reserve price of $700 million. This works out to about $1,401 psf ppr inclusive of a DC of about $55 million. The all-in investment for the successful developer of the 192,340 sq ft freehold site is expected to be around $1 billion. Based on the unit land price of $1,401 psf ppr, the breakeven cost for a new luxury condo project on the site could be about $1,950-2,100 psf. A 25th floor unit at the nearby Aalto was transacted at $2,373 psf this month. Over at Seafront@Meyer, units on the 17-20th floors have traded at $1,875-2,051 psf in the past few months. The Hawaii Tower site is zoned for residential use with a 2.8 plot ratio and height of up to 36 storeys. The plot may potentially be developed into a new condo project with about 345 units of an avg size of 1,500 sq ft or 430 units averaging 1,200 sq ft. A new development on the site will boast unobstructed views towards the sea, Marina Bay Sands and the city skyline as well as the Mountbatten landed housing estate. The regular-shaped plot has frontage of over 130 metres along both Meyer Road and the East Coast Parkway. CB Richard Ellis is marketing Hawaii Tower's collective sale through a tender which will close on Jan 26. Owners controlling slightly over 80 per cent of share values and strata floor area have signed the collective sale agreement. They stand to receive about $5-million-plus per apartment and $8.8-million-plus per penthouse. Hawaii Tower comprises three blocks holding 129 apartments of about 2,200 sq ft each and six penthouses of about 4,300 sq ft each. Two land deals in the vicinity earlier this year - two adjacent bungalows at Margate Road that sold for $1,023 psf ppr including DC, and 16 terrace houses at Fort Road which fetched about $1,080 psf ppr including DC and the estimated cost of buying a cul-de-sac from the state.
- The Business Times, P12
Developers may baulk at price tags
More and larger collective sales are in the pipeline as home owners attempt to cash in on the hot property market. Hawaii Tower along Meyer Road is among those in the latest batch to have secured the necessary 80 per cent approval from residents, along with former HUDC estate Pine Grove. And more than 53 per cent support has been secured so far in the collective sale process for Pearl Bank apartments in Outram. Although more collective sale tenders are expected to come on the market in the first half of next year, experts say a wide gulf could be opening up between owners' asking price expectations and what developers are willing to pay. They add that high reserve prices and the bumper release of state land in the government land sales programme might reduce demand from developers. Development charges have increased substantially and the new rules regarding the completion period for developers with foreign shareholders would place further downward pressure on what developers are willing to bid. But property market watchers say developers are often keen on such sites as they provide an opportunity to purchase freehold land in prime locations, unlike those from the government land sales programme, which are on 99-year leases.
- The Straits Time, B26
Exec condo surprises with DPS option
NTUC Choice Homes Co-operative (NCH) and Chip Eng Seng (CES) are launching an executive condominium (EC) project in Punggol with a surprising feature - a deferred payment scheme (DPS). Many in the property industry had assumed that the DPS was entirely scrapped in the boom year of 2007 to curb speculation. The two developers' move could trigger owners of other EC projects to also offer DPS. NCH and CES are behind the 99-year-leasehold Prive, the first EC to come up in Punggol. The site is at the junction of Punggol Field and Punggol Road, and average selling prices will be between $660 and $690 per square foot (psf). There will be 680 apartments ranging from two to four-bedders, located across four 17-storey towers. The developers bought the plot from the government in June this year. The developers will open the sales gallery on Dec 3 and allow viewings and applications up until Dec 7. Bookings will start on Dec 10 and home seekers have to gain entry to the gallery that day through a ballot. Developers of two earlier EC projects - Esparina Residences and The Canopy - did not offer DPS. Several developers and consultants whom BT spoke to were surprised to learn that DPS was allowed for EC projects. In October 2007, the government withdrew DPS for the sale of uncompleted private residential, commercial and industrial properties. The news release made no mention of ECs then. Following some checks yesterday, BT understands that the withdrawal of DPS in 2007 did not apply to ECs.
- The Business Times, P2
Upper Serangoon DBSS site draws just 2 bids
A land parcel offered for sale under the Design, Build and Sell Scheme (DBSS) at Upper Serangoon Road received just two bids at the close of the government tender. A unit of Low Keng Huat (Singapore) made the higher bid of $155.2 million. The price works out to $206 psf ppr. Based on the tender price, Low Keng Huat will be looking to sell the upcoming flats on the site at about $500-540 psf. New sites for private residential developments in the vicinity are now being sold for upwards of $300 psf ppr. ERA's data shows that four-room resale HDB flats in the area are selling for $400,000-420,000 while five-room resale flats are going for around $500,000-540,000. The 103-year leasehold site along Upper Serangoon Road is about 215,300 sq ft in size and has a maximum allowable gross floor area of 753,500 sq ft. It can accommodate an estimated 630 units.
- The Business Times, P1
- Also quoted in The Straits Time, B25, “Condo-style public housing plot attracts only two bids”.
Employment at highest level since 1991
Singapore’s robust economic recovery and tight labour market over the past year have brought cheer for workers on several fronts, going by data in a just-released report on employment and earnings. Employment among residents which is at its highest level since 1991 - when the Government started collecting and publishing data on the resident workforce and employment rate - was fuelled in part by more women and older residents being attracted to join the workforce. Also encouraging in the Singapore Workforce 2010 report, released yesterday by the Manpower Ministry, was data which showed a modest drop in the number of low-wage workers - those who earn $1,200 or less a month. There were 262,700 such workers holding full-time jobs in June this year - less than the 275,000 in June last year. The chief reason for the dip: They graduated to higher-paying jobs on the back of the stronger economy.
- The Straits Times, P1
- Also quoted in The Business Time, P2, “Economic recovery pulls up job numbers”.
India's GDP surges for 3rd straight quarter
India's economic growth has exceeded 8 per cent for the third straight quarter, adding to evidence of a strengthening in domestic demand that has stoked inflation by placing strains on the nation's transport and power systems. Gross domestic product rose 8.9 per cent in the three months through September from a year earlier, matching the revised pace of growth in the previous quarter, the Central Statistical Organisation said in a statement in New Delhi yesterday. That was above the 8.2 per cent median estimate of 30 economists. Consumer prices are rising at a pace near 10 per cent, the fastest in the G-20 nations after Argentina. In comparison, the economy expanded 1.9 per cent last quarter in the 16-nation eurozone, 2.5 per cent in the US and 9.6 per cent in China.
- The Business Time, P16
INDIA - Indian developers face higher loan rates
India's real- estate developers may face rising borrowing costs and shrinking access to credit, as record corporate lending slows amid a bribery probe that led to the arrests of eight executives. The combination of the regulatory review and tighter central bank provisioning rules may cause rates on loans for developers to rise as much as 200 basis points, or two percentage points. Property companies in emerging markets are facing rising loan costs as central banks tighten policy to guard against concerns that monetary expansion by central banks in Europe and the United States will fuel asset bubbles. Indian developers that had managed to repair balance sheets after the global credit crisis may face delayed loan approvals. Bank financing will now be subjected to more screening and approvals, forcing developers to rely on cash flows and sales of property to service debt.
- The Business Times, P16
Exchange Rates (extracted from xe.com)
1.00 SGD = 0.75 USD
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ST Index change: 3,144.70 (-13.51) *As at Wed 1 Dec 2010 09:26 AM
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